The Market is up 17. ASX 200 Futures were up 35 this morning after the Dow Jones finished up 138 overnight.

The Dow was up 160 at best on light volumes ahead of the Federal Open Market Committee meeting tonight in the US. The 248 points added this week in the lead up suggests that markets are expecting mostly reassuring words from Chairman Ben Bernanke at the press conference.

US housing starts were +6.8% to a seasonally adjusted annual rate of 914,000 units in May. The reading was below the forecast of +11.4% but well above the previous reading of -14.8%. Permits to build homes were 0.974 million, which was below the forecast of 0.980 million and the previous reading of 1.005 million. US inflation rate +0.1% in May to be +1.4% over the year. The MonM reading was below the forecast of +0.15% but above the previous reading -0.4%.

The German ZEW economic sentiment index rose from 36.4 to 38.5 in June beating the forecast of 38.0. The UK’s YonY inflation rate is now at +2.7%, which was above the previous years reading of +2.4 and forecast of +2.6%.

European markets mixed — UK FTSE up 0.69%, Germany up 0.17%, France down 0.08%, Spain up 0.54%, Italy up 0.02%.

Metals down — copper down 1.11%, nickel down 0.98%, aluminium down 0.28%, zinc down 0.07%. Spot iron ore was up $2.70 to $117.70. Gold was down $15.80 to $1367.30.

Announcements and stories:

  • Whitehaven Coal (WHC) — Nathan Tinkler has sold his stake in WHC to Farallon Capital Management. The company has now taken ownership of 16.6% of WHC. The notional value of the transfer is 296c per share which equates to $350 million or about half of what is understood to be the amount of the debt owed. Patersons has a BUY recommendation with a price target of 365c per share.  WHC is up 4.27% to 220c.
  • News Corp (NWS) — The two separately listed companies begin trading on the ASX midday today on a deferred settlement basis. The spin off company is called New News Corp (NNC) which owns the newspaper and publishing business in Australia, US and UK. Twenty-first Century Fox is the second company — which will initially trade under the company’s current name News Corp (NWS). A CBA analyst valued NNC shares at 1706c while shares in 21st Century Fox were valued at 3196c. The offer is — 1 NNC for 4 NWS currently held. NWS is down 9.24% to 2976c.
  • Pacific Brands (PBG 70c) — Finished down 0.71% yesterday after they held an investor presentation on their underwear division. Underwear accounts for around 59% of the company’s revenue. Brokers were overall pleased with the direction and international growth plans the company presented and EPS forecasts have been lifted slightly. The stock is on a PE of 8.4x with an EPS forecast of 2.4%, gross yield of 10.28% and ROE of 15%. PBG is up 1.08% to 70.25c.
  • Tonight in the US – FOMC rate decision, release of economic projections and Fed Chairman Ben Bernanke’s press conference.